Developer signs $190M sales agreement for Transbay Tower site

A sigh of relief echoed over the city when developers finally signed a $190 million deal to buy the SoMa site earmarked for a 61-story skyscraper that will be the centerpiece of the planned Transbay Transit Center.

The price paid by Hines, the developer, is the most in city history for a large development site, at least on a square footage basis. But it was the $5 million deposit, not the $190 million selling price, that had city officials worried.

That’s the amount the Houston-based developer was supposed to come up with by Sept. 30 to hold its place on the deal for the 1,070-foot-tall office tower at First and Mission that would become the city’s tallest building.

But when MetLife pulled out of the arrangement last summer, Houston-based Hines was left scrambling for a new partner with deep pockets. So the Transbay Joint Powers Authority, which is overseeing the high-rise — and high-dollar — development that will take place around the planned Transbay Transit Center, was forced to give Hines an extension, all the while desperately hoping the deal didn’t fall through and force a time-consuming search for a new developer.

Since money from the property sale was central to transit center construction, any delay would have been a major setback.

But in late October, Boston Properties signed on as an equal partner with Hines and everything was back on track. Hines not only has put up $10 million that will be forfeited if the sale doesn’t close by April 1, but also has agreed to pay about $1 million in permit costs, attorney fees and other expenses the authority has fronted for the project, said Maria Ayerdi-Kaplan, the authority’s executive director.

“The Transit Center and Tower are two projects that are transforming transportation into our city, as well as transforming the SoMa neighborhood,” Mayor Ed Lee said in a statement. Advancing those projects “is critical to the investment in the future of San Francisco.”